ILBA INFORMATION UPDATE
COVID 19 Disruption Tuesday, March 24, 2020
1) Federal Updates:
- Federal Relief Legislation – The Senate has voted twice – Sunday and Monday – to advance COVID-19 relief legislation but has failed secure enough votes to proceed. As negotiations continue in the Senate, House Democrats have released their own $2.5 trillion counteroffer. Reports indicate that Treasury Secretary Steven Mnuchin has agreed to “significant oversight” of a $500 billion fund in a proposed rescue package. Oversight of that fund has been a concern for Democrats worried about accountability of how the funds will be used. Administration officials and Congressional leadership are pushing for passage of the legislation today. Many small businesses are waiting to see when the bill will pass and what it will include so they can make business decisions for their companies and their employees.
What does this mean for on-premise licensees who have been forced to close or severely alter their businesses? The Senate bill calls for $500 billion that the Treasury could distribute to corporations, but also $350 billion dedicated to small businesses, and potentially the ability for small businesses to obtain loans up to 250 percent of their one-month payroll. Potentially, if these loans were used for qualifying business expenses (e.g. rent, workers), the loan could be forgiven. BUT, it’s worth reminding everyone at this point that the situation is incredibly fluid and more complex now with the introduction of the House Democrats’ bill.
- Treasury, IRS, Labor – Implementation of Coronavirus-Related Paid Leave for Workers and Tax Credits for Small & Midsize Business – The U.S. Treasury Department, Internal Revenue Service (IRS), and the U.S. Department of Labor (Labor) have announced that small and midsize employers can begin taking advantage of two new refundable payroll tax credits, designed to immediately and fully reimburse them, dollar-for-dollar, for the cost of providing Coronavirus-related leave to their employees. This relief to employees and small and midsize businesses is provided under the Families First Coronavirus Response Act (Act), signed by President Trump on March 18, 2020.
The Act gives all American businesses with fewer than 500 employees funds to provide employees with paid leave, either for the employee’s own health needs or to care for family members. The legislation will enable employers to keep their workers on their payrolls, while at the same time ensuring that workers are not forced to choose between their paychecks and the public health measures needed to combat the virus. For more information about these credits and other relief, visit Coronavirus Tax Relief on IRS.gov. Information regarding the process to receive an advance payment of the credit will be posted in the coming days.
2) Helpful Articles for small businesses in the hospitality industry.
How to Shut Down Your Draft Systems During COVID-19 Closures – Bar Business Magazine
COVID-19 & Insurance: Are You Covered? – Bar Business Magazine
3) Industry Service Member Relief Campaigns:
Beam Suntory and Southern Glazer’s Wine & Spirits: Beam Suntory and Southern Glazer’s Wine & Spirits Donate $1 Million to support impacted bar and restaurant employees.
Diageo: USBG National Charity Foundation
Gallo / New Amsterdam: Support Your Local Bartender
Daniel D. Clausner